OFFICE OF THE INSPECTOR GENERAL NATIONAL GUARD SUPPORT TO DRUG INTERDICTION Report No. 95-019 October 28, 1994 Department of Defense Additional Copies To obtain additional copies of this report, contact the Secondary Reports Distribution Unit, Audit Planning and Technical Support Directorate, at (703) 604-8937 (DSN 664-8937) or FAX (703) 604-8932. Suggestions for Future Audits To suggest ideas for or to request future audits, contact the Planning and Coordination Branch, Audit Planning and Technical Support Directorate, at (703) 604-8939 (DSN 664-8939) or FAX (703) 614-8542. Ideas and requests can also be mailed to: Inspector General, Department of Defense OAIG-AUD (ATTN: APTS Audit Suggestions) 400 Army Navy Drive (Room 801) Arlington, Virginia 22202-2884 DoDHotline To report fraud, waste, or abuse, call the DoD Hotline at (800) 424-9098 (DSN 223-5080) or write to the DoD Hotline, The Pentagon, Washington, D.C. 20301-1900. The identity of writers and callers is fully protected. Acronyms CDC Counterdrug Coordinator GAO General Accounting Office LAV Light Armored Vehicle LEA Law Enforcement Agency NGB · National Guard Bureau OSD Office of the Secretary of Defense RAID Reconnaissance and Interdiction Detachment INSPECTOR GENERAL DEPARTMENT OF DEFENSE 400 ARMY NAVY DRIVE ARLINGTON, VIRGINIA 22202-2884 October 28, 1994 MEMORANDUM FOR ASSISTANT SECRETARY OF DEFENSE (SPECIAL OPERATIONS/LOW-INTENSITY CONFLICT) ASSISTANT SECRETARY OF THE AIR FORCE (FINANCIAL MANAGEMENT AND COMPTROLLER) DOD COORDINATOR FOR DRUG ENFORCEMENT POLICY AND SUPPORT AUDITOR GENERAL, DEPARTMENT OF THE ARMY CHIEF, NATIONAL GUARD BUREAU SUBJECT: Audit Report on National Guard Support to Drug Interdiction (Report No. 95-019) We are providing this report for your review and comments. The report discusses National Guard support to the drug interdiction programs of law enforcement agencies. Management comments were considered in preparing the final report. Based on management's comments, we deleted three draft recommendations from this final report. DoD Directive 7650.3 requires that all audit recommendations be resolved promptly. Therefore, we request that the DoD Coordinator for Drug Enforcement Policy and Support and the National Guard Bureau provide estimated completion dates for corrective actions. Final comments on the unresolved recommendations are requested by January 6, 1995. The courtesies extended to the staff are appreciated. Ifyou have any questions on this audit, please contact Mr. Harrell D. Spoons, Audit Program Director, at (703) 604-9574 (DSN 664-9574), or Mr. Marvin L. Peek, Audit Project Manager, at (703) 604-9587 (DSN 664-9587). The distribution of this report is listed in Appendix G. The audit team members are listed inside the back cover. ,Uij&-, Robert J. Lieberman Assistant Inspector General for Auditing Office of the Inspector General, DoD Report No. 95-019 October 28, 1994 Project No. 3RF-0055 NATIONAL GUARD SUPPORT TO DRUG INTERDICTION EXECUTIVE SUMMARY Introduction. Congress has authorized the National Guard (the Guard) to provide direct support to law enforcement agencies for drug enforcement and interdiction operations. In FY 1993, the Guard spent $171 million on counterdrug missions within the United States and its territories. Objectives. The objectives of the audit were to determine whether Guard drug interdiction programs were cost-effective and prioritized to satisfy requirements of the law enforcement agencies and how well the programs met those requirements. The audit also determined whether the National Guard Bureau had taken effective action in response to recommendations in Inspector General, DoD, Audit Report No. 91-107, "National Guard Support of U.S. Drug Interdiction Efforts," July 2, 1991. Audit Results. Federal, state, and local law enforcement agencies overwhelmingly agreed that the Guard has made significant contributions to their drug interdiction efforts. Although counterdrug funds were generally allocated fairly, objective criteria had not been established to prioritize and allocate counterdrug funding among the 54 Guard Components, and counterdrug resources could have been more effectively used. As a result, there was no assurance that counterdrug funding was allocated to the most effective or productive Guard operations (Finding A). About 21 percent of counterdrug pay and allowances received by the 15 Guard Components audited was spent for management and administration of the Counterdrug Support Program in FY 1993. If the projected management and administrative costs had been reduced to 15 percent of pay and allowances for all 54 Guard Components, an estimated $8.9 million could have been used to provide direct support to law enforcement agencies (Finding B). The National Interagency Counterdrug Institute (the Institute) did not conduct training courses efficiently. As a result, the Institute spent at least $1.2 million of counterdrug funds for unnecessary personnel, travel, transportation, and rental costs (Finding C). The Guard plans to purchase 12 light armored vehicles that have little use in a counterdrug role. As a result, the Guard could spend counterdrug funds for vehicles that will have minimal use and will consume diminishing counterdrug resources (Finding D). The recommendations in Audit Report 91-107 were adequately implemented except that additional improvements were needed in allocating counterdrug resources, measuring the effectiveness of support, and reducing the cost of the Institute, as discussed in Findings A and C. Details on the implementation of the recommendations are in Appendix B. Internal Controls. The audit identified material internal control weaknesses. Controls were not effective to allocate counterdrug funds based on mission priority, to measure Program results, to limit management and administrative costs, or to reduce operating costs at the National Interagency Counterdrug Institute. See Part I for a discussion of the internal controls assessed and Part II for details of the control weaknesses. Potential Benefits of Audit. Recommendations in this report, if implemented, will help to effectively allocate and efficiently use counterdrug funds. About $54.6 million could be put to better use for FY 1995 through FY 2000 by reducing the cost of counterdrug management and administration in the 54 Guard Components and by eliminating unnecessary expenditures at the Institute. Appendix E summarizes the potential benefits of the audit. Summary of Recommendations. We recommend establishing criteria to allocate funding among the Guard Components; developing useful measures of Program effectiveness; establishing guidelines for appropriate costs of administering the Counterdrug Support Program; reducing unnecessary expenditures at the Institute; relocating the Institute to a less costly facility; and requesting Congress to repeal legislation requiring that Light Armored Vehicles be purchased for the Counterdrug Support Program. Management Comments. The Assistant Secretary of Defense (Special Operations/Low-Intensity Conflict) and the National Guard Bureau generally concurred with recommendations to establish policy governing the allocation of counterdrug funds, to develop a system to measure Program effectiveness, to limit costs associated with management and administration of the counterdrug program, and to seek reductions in the operating cost of the Institute. The Guard disagreed with a draft recommendation to relocate the Institute because the cost data on which the auditors relied was flawed and expected monetary benefits would not be realized. The Assistant Secretary disagreed with a draft recommendation to request repeal of legislation that requires procuring nonstandard, light armored vehicles for counterdrug missions because of congressional support for purchasing the vehicles. Audit Response. We accepted the management comments concerning relocation of the Institute and procurement of light armored vehicles and deleted the recommendations from this report. In response to this report, the DoD Coordinator for Drug Enforcement Policy and Support should provide expected completion dates for planned actions concerning fund allocation and measures of Program effectiveness. The National Guard Bureau should provide expected completion dates for planned actions concerning program management and administration and cost reductions at the National Interagency Counterdrug Institute. Final comments on the report are requested by January 6, 1995. ii Table of Contents Executive Summary 1 Part I - Introduction 1 Objectives 3 Scope and Methodology 3 Internal Controls 5 Prior Audits and Other Reviews 5 Part II - Findings and Recommendations 7 Finding A. Allocation and Use of Counterdrug Support Funds 8 Finding B. Management and Administration of the Counterdrug Support Program 14 Finding C. National Interagency Counterdrug Institute 21 Finding D. Procurement of Light Armored Vehicles 31 Part III - Additional Information 37 Appendix A. Counterdrug Funds Obligated in FY 1993 38 Appendix B. Statistical Sampling Plan and Projections 40 Appendix C. Observations and Suggestions to Improve the Counterdrug Support Program 42 Appendix D. Summary of Prior Audits and Other Reviews 46 Appendix E. Potential Benefits Resulting from Audit 51 Appendix F. Organiz.ations Visited or Contacted 53 Part IV - Management Comments 59 Assistant Secretary of Defense (Special Operations/ Low-Intensity Conflict) Comments 60 National Guard Bureau Comments 64 Part I - Introduction Introduction Background On September 29, 1988,